Chase Clymer, co-founder of Electric Eye and host of the Honest Ecommerce podcast, joined the Ten K Collective Podcast to discuss the transition from Amazon to Shopify. He recommends that if someone were to start an ecommerce brand today, they should use Amazon, even though they would need to learn a lot about the platform. He believes Amazon has a built-in audience and can help increase sales. He also recommends taking advantage of the Amazon Profit Quiz to help identify areas of waste and how to address them.
Starting an Ecommerce Brand: Shopify or Amazon?
When it comes to starting an ecommerce brand, the two most popular platforms are Shopify and Amazon. Both have their own set of advantages and disadvantages, making it difficult to choose between the two. In this post, we’ll discuss the pros and cons of each platform and provide some guidance on which one might be better for your brand.
Why Choose Amazon?
Amazon is a massive marketplace that has a built-in audience of millions of users. This can be a huge advantage for new ecommerce brands that are looking to test their product and find product-market fit (PMF) quickly. With Amazon, you can get feedback on your product and make adjustments rapidly. Amazon’s customer data and algorithms can also help you to find new customers and increase sales.
However, there are also some downsides to using Amazon. While it’s a great platform for testing and validation, it may not be the best long-term solution. Amazon takes a percentage of your sales and owns your customer data, which can limit your ability to grow your brand and increase profits. Additionally, if you’re selling a luxury product, Amazon may not be the best fit, as it tends to favor commodity products with low margins and low average order value (AOV).
When to Transition from Amazon to Your Own Platform?
The decision to transition from Amazon to your own platform will depend on several factors, such as your revenue, profit, and business goals. According to experts, when sales are “just happening,” and your revenue is in the thousands, it’s a sign that you’ve found PMF. However, to build a sustainable and sellable business model, you need to build your own platform.
If your brand has a unique value proposition or a flagship product that performs well on Amazon, you may consider building out your own store. However, you need to ensure that your AOV is above $75, and your profit margins are high enough to acquire customers through paid media channels like Facebook and Google.
Why Choose Shopify?
Shopify is a popular ecommerce platform that allows you to build your own online store and customize it according to your brand’s needs. It offers a range of features, such as inventory management, payment processing, and shipping integrations, making it easier to run your business. Shopify also has a lower barrier to entry than Amazon, as you don’t need to compete with other sellers on the same platform.
However, Shopify also has its disadvantages. You’ll need to spend money on advertising and marketing to drive traffic to your site and build an audience. Additionally, building a unique brand on Shopify can be challenging, as it’s a popular platform that many brands use.
When to Optimize Your Shopify Store?
To get the best return on ad spend (ROAS), you need to optimize your Shopify store. This involves identifying areas of your site that are causing friction for customers and making improvements to increase conversion rates and AOV. Techniques like heat maps, scroll maps, and customer interviews can help you to identify these areas and build hypotheses to improve them. Additionally, regular maintenance of your store is crucial to keep it running smoothly.
When choosing between Shopify and Amazon, it’s important to consider your business goals, revenue, profit margins, and target audience. Amazon is a great platform for testing and validation, but may not be the best long-term solution for luxury brands or those with high margins. Shopify offers more control over your brand and customization options, but requires more investment in marketing and advertising to build an audience. Whatever platform you choose, optimizing your store for conversion rates and AOV is essential to get the best ROAS and build a sustainable ecommerce business.
- Don’t miss out on the valuable insights and inspiring stories shared on Chase’s podcast “Honest Ecommerce.co“!
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